Indian Capitalism: A Case that doesn’t Fit?

Abstract

Abstract: This paper critically examines the ‘Varieties of Capitalism’ (VoC) School’s approach to constructing typologies of capitalisms with reference to the specific case of Indian capitalism. It emphasizes that two factors related to its origin and initial emergence remain crucial for explaining many of the key and sometimes very specific outcomes being generated by the operation of Indian capitalism in its current stage. These factors are, firstly, that Indian capitalism was born out of the womb of capitalist colonialism, and secondly, that no thoroughgoing agrarian transformation happened in India before or after independence. These have strongly conditioned capitalist development in India after independence, first under a more statist and protectionist regime till 1991 and subsequently under a more open and market‐oriented policy in the era of globalization. The transformational impact of this development has been consequently limited, even in comparison to other late‐industrializing Asian capitalisms, and insufficient to transcend these factors. Yet changes have happened over time, which lie behind the break state economic policy made with the past in 1991. The paper argues that such a combination of continuity and change poses some vexing problems for the characterization of contemporary Indian capitalism as a particular variety.

Evans, P. (1995) The Embedded Autonomy: States and Industrial Transformation. Princeton, New Jersey: Princeton University Press.

Gourevitch, Peter, Michael Hawes (2001) ‘Political Institutions and National Production Systems in the Globalized Economy’, Paper prepared for the conference Business Interests and the Varieties of Capitalism: Historical Origins and Future Possibilities at The University of North Carolina Chapel Hill, November 2/3, 2001.

Kang, Nahee (2006) ‘A Critique of the “Varieties of
Capitalism” Approach’, No. 45-2006, Research Paper Series, International Centre for Corporate Social Responsibility, Nottingham University Business School

Kochanek, Stanley A. (1974) Business and Politics in India. Berkley: University of California Press.

Kohli, Atul (2009a) 'Politics of Economic Growth in India, 1980-2005, Part I: The 1980s' in Atul Kohli, Democracy and Development in India, From Socialism to Pro-Business. New Delhi: Oxford University Press: 140-63.

Kohli, Atul (2009b). 'Politics of Economic Growth in India, 1980-2005, Part II: The 1990s and Beyond' in Atul Kohli, Democracy and Development in India, From Socialism to Pro-Business. New Delhi: Oxford University Press: 164-185.

Lamb, Helen B. (1955): “The Indian Business Communities and the Evolution of an Industrialist Class”, Pacific Affairs, 28 (2): 101-116.

Pedersen, Jorgen Dige (2007) ‘The transformation of Indian business: from passive resisters to active promoters of globalization’, Paper prepared for Sixth Pan-European Conference on International Relations, University of Turin, Italy, 12.-15. September 2007.

Rao, J. Mohan (1994), ‘Agricultural Development under State Planning’, in Byres (1994), 220-264.

Whitely, R. (1998) ‘Internationalization and Varieties of Capitalism: The Limited Effects of Cross-National Coordination of Economic Activities on the Nature of Business Systems’, Review of International Political Economy, 5(3): 445-481.

Whitely, R. (1999) Divergent Capitalisms: The Social Structuring and Change of Business Systems. London: Oxford University Press.

Yamamura, K., and W. Streeck (eds.) (2003) The End of Diversity? Prospects for German and Japanese Capitalism. New York: Cornell University Press.